Condo units that are in preconstruction are priced at such a discount because the developers that are building them need funds for construction.  This is for many reasons.  Banks generally require at least a degree of funding before they will issue a loan to develop a property.  Developers want to get to this number as quickly as possible so that they can break ground and ultimately sell their units and make a profit sooner.  Because of this, they’re willing to offer significant discounts to people that are will to share the risk with them.

Despite the big discounts, buying units in preconstruction isn’t for everyone.  Specifically, it is great for people looking to invest, but not a great option for people who want the home for their own personal use.  Investors can use the property to flip or as a rental property.  Because of this, the unit only has to be something a certain demographic or the general public will like, not something that the individual investor has to like and live with every day.  You also generally won’t be able to move in for a year or two, a time frame that will discourage many individual property owners.

Beachfront Condo Construction

If you’re an investor, buying oceanfront condos in preconstruction is almost like buying an option.  Because you only need to put down a small amount of the final price at the beginning, usually around 10% of the final price, you stand to get huge returns, or huge losses if the property market collapses.  Since most of your gains in preconstruction investment will come from this leverage that you can receive, it’s imperative that you study the market before you put one penny down.  Here are the things that you should look for in a good property market.

The first thing that you need to look at is the oceanfront condo unit itself.  Is it something that the general public will want to buy?  What is the target demographic that you can expect to sell or rent the property to?  Why would they want to rent this property.  Before you buy any property make sure that you know exactly who you’re planning on selling or renting the condo to and why they would choose your condo over other locations or even other condo units in the same area.  You should have a firm answer to all these questions before you continue.

While you’re investigating who will buy the beachfront condos that you’re looking at investing in, also do a through backgrounds check of the developer that’s in charge of your property.  The developer should have a strong track record and be in good financial condition so that you can be assured they can get the building done without running into financial trouble.

Next, look at the other building supplies in the pipeline for your area.  What other condo buildings, housing developments, or other infrastructure will be in place when your condo unit will be ready that can impact the property value of your unit.  Ideally, you want to find an area that has improving infrastructure to attract more people or make it easier to get to but some kind of constraint on development, making sure that supply is limited.

Finally, especially if you’re looking at buying property outside the U.S., the local property market should be fairly liquid.  This means that there’s lots of buyers and sellers and there aren’t any major obstructions to buying or selling property.  In some countries there are restrictions on foreign property ownership, so make sure you take this into account before you sign your final papers.

Where you’re looking at investing in preconstruction beachfront condos, there are several things that you should look for.  First, make sure that you know who wants to buy your property and why and the financial state of your developer.  Next, look at the market.  The market should have several characteristics to make it a good investment.  These include a abundant supply of buyers, supply constraints, liquid transactions, and of course an appreciating market.  If you follow these tips you should be well on the way to finding a great beachfront condo for a cheap price that can net you a nice healthy retun once construction is finished.

Related posts:

1. Finding Great Beachfront Property for Sale
2. Finding Your Perfect Beach House for Sale
3. 4 Beachfront Condo Buying Tips

Cheapest Beachfront Property in the U.S.

Beachfront property prices in the United States are by no means low and have been growing explosively in the last few years. However, the housing bubble of 2008 and 2009 gave a huge hit to housing prices, especially in areas like Florida. While the housing bubble is having disastrous effects on the economy as a whole, you can find a silver lining in it if you have some extra cash saved up. Florida beachfront property is a fraction of the price that it was just a few short years ago, especially if you can find foreclosure auctions. While property prices may not end up having the same explosive growth that they’ve had in recent years, if you’d like to have a beach home and have some years to sit on the investment, property prices will eventually rise again. Just make sure that you are in the financial position to handle the mortgage.

Cheap Beachfront Property Abroad

If you really want to find very cheap property right on the ocean, as well as a lower cost of living, you’ll need to leave the shores of the United States and travel to other countries. Many place in Latin America welcome investment and are home to pristine coasts and tropical surroundings that are unmatched even in the most expensive communities in the U.S.

One very popular destination for expats from the U.S. in recent years has been Costa Rica. Costa Rica has incredibly temperate weather, great surroundings, several different ecological zones, and mile upon mile of pristine coast on either side. Property prices here are still relatively cheap compared to those in the U.S., but they have jumped exponentially in the last ten years as more and more people have found out about it. If you’re looking for a more upscale location though, Costa Rica is definitely for you as it’s home to a very vibrant expat community and has many gated developments to choose from.

It seems one of the best options for cheap real estate in Latin America today is Equator. Equator is situated right on the equator and because of this has weather that remarkably resembles Hawaii’s year round and the beaches are just as good. It is only a few hours flight from Miami and investment from foreigners is welcomed and encouraged, unlike in some other countries like the Philippines.

If you want a Caribbean atmosphere, St. Lucia and Grenada are home to some great pieces of cheap ocean front property. St. Lucia, in particular, has property prices that are almost sixty percent lower than those in nearby Barbados. Panama and the northeast coast of Brazil are also great options to find reasonable priced property in Latin America.

How to Find Cheap Beachfront Property Abroad

When you’re attempting to buy beachfront property in another country, you need to be incredibly cautious. Start your primary research on the internet, but don’t try to close the sale or sign any contracts without visiting the country first. Make sure it’s a place you want to live and spend a few weeks getting to know some of the locals. If you make friends with them, they should be able to suggest an honest real estate agent to you. Most listings online are actually marked up significantly for the internet and you can usually find much lower offers in country.

If you really want to find the cheapest beachfront real estate in the world, you’re going to have to leave the shores of the U.S. and head to another country further afield. But before you do this, make sure that it’s actually what you want. Are you going to be using the property mostly for a long weekend getaway? If that’s the case, it may not be worth the time and money it takes to fly to a remote Latin American location. In fact, before you’re done flying to and from your location, you might actually end up spending more than if you bought a property closer to home. Make sure you know exactly what you want before you buy.

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